The Yow Company makes and sells a single product, the Zingo.Each Zingo requires 1.5 direct labor hours at an average rate of $7.60 per hour.If the budgeted direct labor cost for June is $151,050, the company's budgeted production must be:
A)16,600 units
B)11,400 units
C)19,875 units
D)13,250 units

Question

Quizplus · Accepted Answer

To find the budgeted production, divide the total budgeted direct labor cost by the cost per unit. The cost per unit is calculated by multiplying the direct labor hours per unit (1.5) by the average rate per hour ($7.60), which equals $11.40. Then, divide the total budgeted direct labor cost ($151,050) by the cost per unit ($11.40) to get 13,250 units.

The Yow Company Makes and Sells a Single Product, the Zingo.Each